OPTIMAL TRANSITION DYNAMICS IN THE LEONTIEF TWO‐SECTOR GROWTH MODEL WITH DURABLE CAPITAL: THE CASE OF CAPITAL INTENSIVE CONSUMPTION GOODS*

We present results on undiscounted optimal policies in the Leontief two‐sector growth model with durable capital. Unlike the results with a labour intensive consumption goods sector, we show that a monotonic optimal programme is only one special case out of many richer possibilities of transition dynamics. Depending on the initial capital stock, and a key parameter ζ that could be interpreted as a marginal rate of transformation of capital between today and tomorrow, an optimal programme may converge to a period‐two cycle; and even when it converges to the golden rule stock, it can do so (damped) cyclically or with a “jump”.     

ENDOGENOUS BUSINESS CYCLES: THE INFLUENCE OF CHARACTER TRAITS*

This article deals with how business cycles can occur, in light of character traits which influence individual behaviour in an economy. We assume an overlapping generations model in which every consumer has identical instantaneous utility which is additively separable with respect to time. The parameters of utility here include character traits which influence the choice between consumption and savings. In this situation, young individuals choose between current consumption and current savings which lead to future consumption in their old age. Individual character traits, which appear both in the shape of utility functions and in evaluations about utility in the future, affect these choices. And since these choices determine savings, individual character traits can eventually determine how our economy moves. Focusing on the relationship between individual character traits and savings formation, we demonstrate that endogenous business cycles with two periods can occur, in an economy comprised of individuals who opt for current consumption and who are careless in relation to future events, like Aesopian grasshoppers, and in other cases they do not.     

THE NORTH KALIMANTAN COMMUNIST PARTY AND THE PEOPLE'S REPUBLIC OF CHINA

In this article, the author offers a detailed analysis of the history of the North Kalimantan Communist Party (NKCP), a political organization whose foundation date itself has been thus far ambiguous, relying mainly on the party's own documents. The relationships between the Brunei Uprising and the armed struggle in Sarawak are also referred to. Though the Brunei Uprising of 1962 waged by the Partai Rakyat Brunei (People's Party of Brunei) was soon followed by armed struggle in Sarawak, their relations have so far not been adequately analyzed. The author also examines the decisive roles played by Wen Ming Chyuan, Chairman of the NKCP, and the People's Republic of China, which supported the NKCP for the entire period following its inauguration.